DTN Midday Grain Comments 03/05 10:49
Grains Seeing Gains Midday Friday
Corn is 6 to 8 cents higher, soybeans are 12 to 13 cents higher and wheat is
2 to 3 cents higher.
David M. Fiala
DTN Contributing Analyst
The U.S. stock market is weaker with the Dow down 90 points. The U.S. Dollar
Index is 0.40 higher. Interest rate products are mixed. Energies are firmer
with crude up $1.60. Livestock trade is mixed. Precious metals are mixed with
gold down $6.00.
Corn trade is 6 to 8 cents higher at midday Friday with active range-bound
action continuing as we head towards the weekend. Spread action is remaining
firm. Ethanol margins are seeing support from energy values and rising world
ethanol prices, as well as spring driving demand. The daily export wire has
remained quiet for the most part this week. Basis should remain sideways short
term as warmer weather will help move grain to town with near-harvest pace of
inbound bushels in some areas. Double-crop planting in Brazil is well underway
as well but behind the usual pace. On the May contract, resistance is the
20-day at $5.45, which we have struggled to challenge this week, with the lower
Bollinger Band at $5.29 as support, which we bounced off overnight.
Soybeans are 12 to 13 cents higher at midday with trade bouncing off a test
of support. Spread action is solid as trade continues to work the upper end of
the range after failing to extend gains on Thursday. Meal is narrowly mixed and
oil is 0.90 cent to 1.00 cent higher. Basis will likely remain flat at strong
levels with slower movement as the export program winds down and a bigger focus
is on crush margins heading into spring. Brazil should remain rainy in the
short term for most with shipments building up steam and a record long line of
ships to load. Argentina is remaining mostly dry short term. The May chart has
resistance at the recent high at $14.45, with support the 20-day at $13.92.
Wheat trade is 2 to 3 cents higher at midday with range-bound action
continuing short term. Trade is looking for a spark from weather to regain
momentum along with further support from the row crops. The dollar is just
below 92 points on the index, getting back to the upper end of the range.
Further consolidation is needed at the upper end of the range with concerns on
the Fed fighting inflation triggering a bit a flight to safety action. The
Plains should see warmer weather, bringing the crop closer to exiting dormancy
soon with some dry pockets persisting and spotty light rains possible. KC is at
30-cent discount to Chicago and Minneapolis is at a 15-cent discount. KC May
chart support is the lower Bollinger Band at $6.09, with resistance the 20-day
at $6.35, which we are just below.
David Fiala can be reached at email@example.com
Follow him on Twitter @davidfiala
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